Almost lost amid the debate over the trade implications surrounding the discovery of BSE in a Texas-born cow was some excellent news.
The futures market and more importantly American consumers hardly batted an eye at this first U.S. homegrown case of BSE.
Live cattle futures prices did slip last week, but it was because beef prices have been pressured lower by strong competition from lower priced chicken.
It looks like the inexpensive, hot and ready-to-eat roasted chicken at the supermarket is a greater threat to the cattle industry than BSE.
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Cattle Buyers Weekly, a U.S. cattle market newsletter, said a telephone survey of 927 adults conducted last week by the National Cattlemen’s Beef Association, showed 92 percent of consumers are confident that U.S. beef is safe from BSE.
This level has averaged 91 percent since the first case in December 2003, NCBA said.
The survey also found that 89 percent of consumers say the United States Department of Agriculture is doing a good job of protecting U.S. cattle from getting BSE and 90 percent say it is doing a good job of protecting the public.
So, despite all of R-CALF’s criticisms of USDA, the American public still trusts the government regulator.
It might be a case that Americans have other concerns, but we hope that their approval stems from having heard about and accepted the legitimacy of the safeguards established to protect the public.
While the Canadian cash cattle market has disconnected somewhat from the U.S. market since BSE closed the border to live trade, the American market is still influential because so much of our beef goes south.
Canada’s cattle market watcher, Canfax, said last week that the Canada-U.S. basis should remain at a little better than $20-under and if the U.S. market sags because of weakening demand, Canadian prices will dip too.
As we have reported over the last couple of years, consumer demand for meat has been exceptional, but there are signs it is weakening a little.
In the U.S., from January to the end of May, beef demand was down 0.8 percent, pork down 2.8 percent, broilers up 4.1 percent and turkey down 6.8 percent.
Analysts think consumers began to view beef and pork as too costly relative to chicken.
Since the start of May, beef and pork prices have fallen and now look more attractive to retailers who perhaps will push the two meats more vigorously during the important summer barbecue season.
This experience of the last couple of months highlights that although BSE is the crisis of the moment for the cattle industry, it can’t forget its long-term struggle with poultry for market share.
For a long time it was losing that race to chicken, with its convenience and variety of prepared foods.
The high protein, low carb craze interrupted that trend, but did not eliminate it.
The ready-to-eat roasted whole chicken dinner available at most grocery stores is just the latest white meat challenge that the beef industry must meet with its own innovation.
